(Reuters) – Spirit AeroSystems <SPR.N> on Tuesday reported a bigger-than-expected quarterly loss and pushed its target of becoming cash flow positive by another year, as top customers Boeing and Airbus slashed production due to a collapse in global travel.
Spirit said it now expects to generate positive cash flow in 2022, instead of 2021, and its current-quarter results will be further hit due to fresh production cuts announced in July by Boeing Co <BA.N> and Airbus SE <AIR.PA>.
Boeing’s 787 Dreamliner and Airbus’ A350 are among the most profitable for the planemakers, but demand for the long-haul jets has sharply fallen due to the COVID-19 pandemic as cash-starved airlines defer deliveries to save money and stay in business.
Boeing, which accounts for nearly 80% of Spirit’s revenue, said last month it would cut 787 output to six units a month in 2021, the fourth such cut since last year when output touched a record 14 units a month.
Airbus SE <AIR.PA> also cut production of A350 to five jets a month last week, after dropping it to six from 9.5 in April.
Spirit booked $194.1 million in charges mainly related to the 787 and A350 cuts in the second quarter, and said will take another charge of about $46.5 million in the current quarter. The company’s total deliveries of shipsets, or complete sets of parts, sank about 65%, resulting in a 68% plunge in revenue for the quarter ended July 2, as the Boeing 737 MAX grounding also hurt.
Shares of Spirit fell as much as 8.9% to over two-month low of $17.76.
The company posted an adjusted loss of $2.28 per share in the quarter, compared with loss estimates of $1.33 per share.
Quarterly revenue came in at $644.6 million, below estimates of $863.2 million, according to IBES data from Refinitiv.
(Reporting by Ankit Ajmera in Bengaluru; Editing by Shinjini Ganguli)